Purchase Solution

why companies merge

Not what you're looking for?

Ask Custom Question

I need some assistance on these questions

What have you learned about the reasons why companies merge? Why is it important to learn about these reasons? How are costs and gains of the acquiring company measured? Name one takeover defense and explain how it works.

Purchase this Solution
Solution Summary

This solution discusses why companies merge.

Solution Preview

One of the most important reasons for companies to merge is to obtain synergies. Synergies can come through revenue enhancement or via cost reduction. For example, merger allows two distinct companies to combine their strengths, product offerings and market share to evolve as a stronger competitor in the marketplace and allows them to combine their strength to obtain greater control over the market. Similarly, cost reduction occurs due to combining the capabilities of both companies, thereby allowing the company to reduce cost via economies of scale, greater bargaining power ...

Solution provided by:
Sheetal Jain, PGDM
Education
  • BComm, University of Delhi
  • Post Graduate Diploma in Management (Equivalent to MBA), All India Management Association
Recent Feedback
  • "Thanks"
  • "Thanks"
  • "Very good! "
  • "thanks"
  • "Thank you!"
Purchase this Solution
Free BrainMass Quizzes
Business Ethics Awareness Strategy

This quiz is designed to assess your current ability for determining the characteristics of ethical behavior. It is essential that leaders, managers, and employees are able to distinguish between positive and negative ethical behavior. The quicker you assess a person's ethical tendency, the awareness empowers you to develop a strategy on how to interact with them.

Accounting: Statement of Cash flows

This quiz tests your knowledge of the components of the statements of cash flows and the methods used to determine cash flows.

Income Streams

In our ever changing world, developing secondary income streams is becoming more important. This quiz provides a brief overview of income sources.

Balance Sheet

The Fundamental Classified Balance Sheet. What to know to make it easy.

SWOT

This quiz will test your understanding of the SWOT analysis, including terms, concepts, uses, advantages, and process.

View More Free Quizzes
Related BrainMass Solutions

  • Organizational Theory and design: After mergers and growth

    Why Do Companies Merge? Retrieved from Associated Content Web site: http://www.associatedcontent.com/article/280471/why_do_companies_merge_pg2.html?

  • Home Depot and Lowe's

    Again, explain your reasoning for wanting to merge with these companies, and why they would be second or third choices rather than your first choice. The second choice of merger will be Dal-Tile Corporation.

  • What company would Safeway merge with?

    Again, explain your reasoning for wanting to merge with these companies, and why they would be second or third choices rather than your first choice. Safeway Although Safeway, Inc.'

  • VISA Company

    Again, explain your reasoning for wanting to merge with these companies, and why they would be second or third choices rather than your first choice. 1. If you were to pick one company for VISA Company to merge with, what would it be?

  • vertical, horizontal, and conglomerate mergers

    If so, why? Any idea or input on this! A vertical merger occurs if two or more firms in different stages of the production of a good merge to form a new company.

  • Company Merger: Net Present Value, Mergers, and Acquisitions

    Again, explain your reasoning for wanting to merge with these companies, and why they would be second or third choices rather than your first choice.

  • Merger analysis and related merger issues are addressed.

    Horizontal mergers take place when two companies in the same industry merge together and form one large company.

  • Mergers and acquisitions

    Again, explain your reasoning for wanting to merge with these companies, and why they would be second or third choices rather than your first choice. (55) Kellogg's second choice for acquisition will be Nestle SA.

  • Herfindahl-Hirschman index

    Let's say the companies that are to merge are A and B, and sum of the squares of all the other companies' market shares are represented by C.

View More Related Solutions